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April 2015

First quarter 2015 is now history, and companies will soon be reporting their Q1 earnings. Here at Semico we’ve checked the IPI Index against our forecast and year-to-date actuals to see if the industry outlook is on track for 2015. Here’s the critical review.

First of all, Semico’s forecast for total semiconductor sales in 2015 is $378 billion, up nearly 9% over 2014. Units will increase to 849 billion representing a 10.5% growth over 2014. However, there is an upside to this forecast. DRAM pricing is expected to remain strong as demand remains healthy and more complex fabrication processes reduce wafer output per fab line, limiting the potential for an over-capacity situation. In addition, the largest memory supplier, Samsung, is slowing its DRAM ramp, i.e. pushing out capex for DRAM capacity. The memory market has played a major role in the growth of semiconductor revenues over the past two years.

On a quarterly basis, Q1 2015 is expected to result in a sequential decline of 2.1% compared to Q4 2014 and a 5% year-over-year increase compared to Q1 2014.